I put this out to wind the libertarians up recently, but it has merit. This is not one world government but is encouraging third world countries to take control of their banking system, then instead of money being created by private bankers for profit, governments can create the money supply for the benefit of ordinary people.

How social Security can save the world ? The case for publicly owned banks.

One of the reasons for the population explosion is that in much poorer countries people often have very large families to ensure that there is someone to look after them in old age. Imagine what it must feel like knowing that you may starve to death in old age because there is no one to take care of you.

Now some children unfortunately die and others won't be loyal when they grow up and will go, so poor people in third world countries may have up to 8 children, or more. Now we could teach governments how to use fiat money to pay for social security and old age care even though these countries are very poor. People will have faith in government money, and if not, this needs to be encouraged which will take time but the investment is worth while.

The government can then spend the fiat money on good quality heath care and when the care workers ‘do work’ this gives the fiat currency its value. As people have faith in the government currency they can then spend this into the wider community on goods and services, and this encourages local businesses to flourish and some people might start to get rich. So there is no need for poor countries to be poor as long as the local environment can grow sufficient food and supply raw materials. The government fiat money now circulates around the economy creating work because people can earn the money to pay for things. Governments can easily end recessions this way.

But there's a problem, coins can last forever and notes could last a very long time too, and so every time the governments needs to pay for more health care it will need to print more money and this could inflate the money supply causing inflation. Now this won't occur if the government money is driving the economy and creating work – where the money gets soaked up and used. But if the money supply exceeds the amount of work that is being generated the solution is to take some of the money back again and this is what we would call tax. So in other words, we don't raise taxes to pay for government services, we only raise them to stop an economy from overheating. This is a very interesting new understanding of fiat money, something the Austrian School had not thought of. And the same principle can apply to our own economies today if the government were to create public banks. So there is no need for any austerity.

This means that there is an almost magical function of government as issuer of the currency, and that high quality public services can be had for very low tax indeed if we were to have public banks pay for the services. And this would also help the economy as a whole as the public workers spend their wages into the wider economy. And if the economy is overheating because of too much money supply the government can then reign some of it back in by taxing. This has no effect on anyone’s spending power and is not aggression. By taking some of the money back in through taxation the price of goods will not inflate. In other words, the government is keeping your money strong by retaining its purchasing power.